American Bank v. Port Orford Cedar Products Co.

It is contended on behalf of the defendant that, it having once paid the amount of the trade acceptances to the stockholders, defendant should not be required to pay the same again for the reason that it had not been disclosed, either by the books or by the plaintiff bank, so as to decrease the net value of the price of the assets. Defendant asserts:

“If a transfer of corporate property and assets is made in good faith and for a proper consideration, the purchaser acquires the property and franchises free from any liability for the debts of the transferring corporation.” 14a C. J. 892, § 3069.…